Bringing Tesla to South Africa – There’s one big issue

Tesla CEO Elon Musk has outlined the problem with bringing Tesla electric vehicles to South Africa.

Musk, who was born in South Africa, was asked in 2018 when he planned on bringing the brand to South Africa to compete in the electric vehicle market.

He responded by saying “Probably end of next year” – which excited many South Africans who wanted to get their hands on one of these vehicles.

However, Musk has since backpedalled on his statement.

He was recently asked again on Twitter whether Tesla will come to South Africa, and his response was less positive than before.

“Would love to, but import duties are extremely high, even for electric vehicles,” said Musk.

Import duties

Musk’s statement regarding high import tariffs means we might not see any Teslas being sold in South Africa for a while, as the government is moving slowly to promote the sale of electric vehicles.

BusinessTech reports that the minister of Trade and Industry, Ebrahim Patel, confirmed the country does not subsidise the importing or production of electric vehicles.

However, Patel said that the government is working to change this.

“The Automotive Production and Development Program (APDP) supports the importing of electric vehicles using a rebate credit certificate,” said Patel.

“I am in discussion with the automobile sector in South Africa regarding the production of electric or hybrid vehicles locally,” he added.

“We are keen to ensure that South Africa develops production capacity in what is anticipated to be a growing part of the car market. On conclusion of the discussions, a formal statement will be made.”

The electric vehicle market in South Africa

Fully-electric vehicles are not popular in South Africa, with under 1,000 being imported to date. Only BMW, Nissan, and Jaguar currently offer full-electric vehicles to South Africans.

Nissan told MyBroadband that the early phases of EV introduction are focused more on demonstration and educating the market than on turning a profit.

“This is a natural step that needs to happen before sales volumes increase in time, together with infrastructure development and government incentives such as tariffs,” said Nissan.

“By reducing the cost [of these vehicles], market pricing can become more attractive, thereby stimulating demand and thus adoption.”

“Demand is required in order to grow volumes and ultimately drive electric charging infrastructure development,” said Nissan.

Nissan also said that while import tariffs are necessary to protect and stimulate local production, the government needs to take the lead from other countries by offering an initial period of incentivisation if it hopes to stimulate the electric vehicle market and create demand in South Africa.

“To succeed, EVs have the same requirements in South Africa as other markets, namely an initial period of government incentives, expanding charging infrastructure and public education and familiarisation programme.”

Nissan added that it is working with the Department of Environmental Affairs, and will continue to do so to increase the volume of electric vehicles on South African roads.

Now read: China wants 60% of car sales to be electric by 2035

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Bringing Tesla to South Africa – There’s one big issue